Taxi permits auction a failure, only one bidder turns up
The number of fleet cabs in the city will not increase in the near future. Reason: The state transport department's ambitious plan to auction 4,000 taxi permits failed on Thursday as only one of the 20 firms placed a bid.mumbai Updated: Aug 27, 2010 01:37 IST
Taxi permits auction a failure, only one bidder turns up he number of fleet cabs in the city will not increase in the near future. Reason: The state transport department's ambitious plan to auction 4,000 taxi permits failed on Thursday as only one of the 20 firms placed a bid.
The plan was that after the bidding, the firms would introduce 40 per cent of the total number of permit taxis bought by them on the road within six months.
"We got a poor response from the bidders. The state government would now decide the future course of action," said Dilip Jadhav, state transport commissioner.
The 20 firms had to bid for a minimum of 1,000 permits tagged at a price of Rs 1 lakh each permit.
Sources said Meru Cabs, which has a fleet of more than 1,800 vehicles, was the only firm to participate in the bidding process.
The city's four fleet cab services — Meru, Mega Cabs, Easy Cabs and Star Taxis — ply around 2,800 vehicles.
The government's plan, which would fetch them close to Rs 50 crore, was to auction the 4,000 permits that originally belonged to the black-and-yellow taxi drivers who had not renewed them for more than 10 years.
Now, the ball is in the state government's court.
Sources in the Regional Transport Office said the state government will now scrutinise if any changes could be made in terms of the tender documents.
"We will see whether the requisite security deposits of Rs 5 crore and bank guarantee of Rs 50 crore quoted by us in the tender was too much for these companies to provide," said an RTO official, on condition of anonymity.
Another reason for the failed auction was citied as the lack of number of drivers available with both, the Mumbai Taximen's Union and fleet cab firms.
Providing incentives to attract permit holders running black-and-yellow taxis, fleet cab firms are asking them to lease their permits for five years and take them into the organisation as 'business partners'.
"Now that the auction has failed, the transport department will have to call for fresh tenders. Before they do that, we would challenge this process in court," said A Quadros, general secretary, Mumbai Taximen's Union. The union was opposed to the auction and had threatened to move court.
The Transport department has filed a caveat with the Bombay High Court as they expected trouble from the Union over the auction.